The Efficacy of Securities Arbitration and Proposals for Change

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April 27, 2010

Members of Briggs and Morgan’s Financial Markets Group worked with the Financial Services Institute (FSI) earlier this year to survey FSI member broker-dealers about their views on arbitration and current Congressional action impacting the financial-services industry.  The survey results and analysis have been published in a white paper entitled, “The Efficacy of Securities Arbitration And Proposals for Change,” which is available here.  Briefly, FSI member firms’ responses to the survey revealed the following trends:

  • FINRA arbitrations are more cost-effective than litigation in terms of total cost and cost to conduct pre-hearing discovery;
  • FINRA arbitrations are generally resolved more quickly than litigation;
  • the perceived benefits of FINRA arbitration diminish when the number of claimants or respondents increases, or when a large demand for monetary relief is made; and
  • arbitrators should provide written decisions that include factual findings and legal conclusions in support of their awards to ensure transparency and consistency of results.

Briggs and Morgan, P.A. is a 2010 Law Firm Sponsor of FSI.  Briggs and Morgan’s Financial Markets Group is comprised of diverse individuals with extensive backgrounds in the legal, regulatory, financial services and investment industries.  Members of Briggs’ Financial Markets Group represent financial services providers and broker-dealers in structuring products and services, securities regulatory counseling, investigations and regulatory proceedings, consumer disputes, complex litigation, class actions and corporate governance.